Property Development Stalled After Funds Ran Dry

Background: 

A client in the property development industry had purchased a property at an auction for £252,000 with the intention of splitting it into multiple units and selling them for a profit. However, due to a series of unforeseen circumstances, including a dispute with subcontractors who had been paid twice for their work, our client found herself running out of funds before completing the development. This put her project on hold, risking financial losses and the loss of a reliable builder she had found.

Challenge:

The primary challenge faced by our client was the sudden shortage of funds required to pay the builders and resume the property development. Time was of the essence, as every day of the stoppage was costing her money. Our client needed a solution that could provide her with a substantial amount of money quickly to avoid further delays and potential setbacks in her project.

Solution:

That’s where we stepped in. We recommended a bridging loan, as a short-term funding option. Within two weeks, our client obtained the loan, enabling her to pay the builders and restart the project. 

Outcome:

Secured a bridging loan with MS Lending at 1%. The bridging loan allowed our client to complete the development, avoiding prolonged delays and financial losses. Despite increased costs, the project’s value of £1.2 million ensured a significant profit. This case highlights the effectiveness of bridging finance for property developers in overcoming funding obstacles swiftly.